Rising health insurance costs drive search for alternatives

Rising health insurance premiums are driving some individuals and small business owners to seek alternatives. In the United States, healthcare workers are increasingly affected by these costs; while only 7% of healthcare workers were uninsured in 2024 compared to 11% of adults under 65, rising expenses are forcing some to forgo coverage entirely.

One alternative gaining traction is health care sharing plans, also known as health care sharing ministries (HCSMs). Unlike traditional insurance, which is a regulated contract that must cover pre-existing conditions and pay claims, HCSMs are nonprofit arrangements where members make monthly contributions to help pay the medical bills of other members. Regulators in states like Tennessee and Michigan note that HCSMs are not insurance companies and have no legal obligation to pay members' costs, as the assistance is entirely voluntary.

The financial pressure is compounded by the fact that pandemic-era Affordable Care Act marketplace credits were not renewed, impacting those in small businesses or self-employment. Employers expect healthcare costs to increase by an additional 8.2% by 2027.